');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');}

Step 3: Profit! Career and retirement plan (but not like gnomes)

profit gnomesThere is an episode of the TV show South Park where there are a group of “underpants gnomes.” The “Underpants Gnomes” are a community of underground gnomes who steal underpants, notably from Tweek (one of the characters).

The Underpants gnomes have a three-phase business plan, consisting of:

1. Collect Underpants
2. ???
3. Profit

None of the gnomes actually know what the second phase is, and all of them assume that someone else does. This sounds surprisingly like a lot of people I know. And it seems to be pervasive in EVERYTHING.

The Bad Career Plan: In my life I have probably asked at least 3000 people “what is your degree?” and a there was a good splattering of every major you can think of. Unfortunately outside of the engineers, who are a very minor number of total people I know/grads (so we shall ignore them) I would say 80% had NO idea what they were going to do when they graduated.

Career PlanThe Worse Career Plan:
A very large portion of those graduate and STILL don’t know what they are doing

The Ugly Career Plan:
A good portion end up working doing the exact same thing they were doing DURING school, or doing something making comparable money.

The Insane Career Plan:
16% of Americans said winning the lottery is an important wealth building strategy. I should add that you are 4X more likely to DIE driving to buy a lottery ticket than you are to win the lottery.

The Lesson:
If you don’t have one already, make a career plan. No matter what you got your degree in, figure out where you want to be in twenty years and make a plan to get there. The magic-career-fairy is too busy to help you so help yourself. If you are in the career you want to be then for your twenty year plan ask yourself these questions:

1) Is it possible to get there in my current job?
2) What salary do I need to achieve to get to that place?
3) Am I building the necessary connections to help me get there?
4) Where do I want to be living?
5) Does this fit with my family/life goals?

retirement planNext up on our list of “plans people don’t seem to think they need, but they are so wrong I want to give them the business end of a cattle prod” is retirement planning. Most peoples retirement model looks like the picture on the right. This one is both simple and extremely complex at the same time. The simple part: download my 401k/Roth IRA calculator and go to town assuming 8% rate of return (conservative). The complex part: deciding how to setup your portfolio, deciding what age you want to retire at. If you want to retire early, deciding how you are going to get by before you can withdraw from your retirement accounts (and don’t tell me you WANT to pay those huge tax penalties unless your retirement portfolio contains the united states treasury). Next make a plan (just like the career plan….how’d you guess I was heading that way). Ask yourself the following questions:

1) What age do I want to retire?
2) At my current rate of contribution can I retire at that age?
3) How much more can I afford to contribute to retirement?
4) Am I being aggressive/conservative enough considering my current age?
5) What is my favorite golf course?

Just remember, plan your career, plan your retirement, and when we are retired we can crack open a high quality beer on the golf course and talk about how smart we were to plan.

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